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Your Weird Uncle posted:i dont even know what asdf's position is anymore All I can say is thank christ we don't have to convince asdf of anything.
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May 9, 2015 16:13
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I remember when McDonalds burgers were $0.29. Where's your god now, liberailures
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May 9, 2015 16:26
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Hi thread powerful anecdote here well I was about to go do unskilled work for $25/h PPP but what do you know all of outside is a postapocalyptic hellscape now. I told them to stop fighting for my rights but they wouldn't listen
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May 9, 2015 16:57
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WhiskeyJuvenile posted:I remember when McDonalds burgers were $0.29. Where's your god now, liberailures That was Hamburger Happy Hour Tuesdays (I think it was tuesday?) from the early 90s, right? I thought that was only a thing they did in my small town to compete with the local slug burgers, but the more you know...
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May 9, 2015 17:07
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Zeitgueist posted:It's absolutely a concern troll. There isn't a coherent economic argument against raising the minimum wage, it should already have been done. So 50 / hr then?
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May 9, 2015 17:28
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tsa posted:So 50 / hr then? there's no reason to post incoherent arguments to agree with zeitguist that there are no coherent arguments, sycophant
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May 9, 2015 17:31
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Popular Thug Drink posted:there's no reason to post incoherent arguments to agree with zeitguist that there are no coherent arguments, sycophant Sorry I can't parse this giberish.
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May 9, 2015 17:32
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tsa posted:So 50 / hr then? That would be good yes.
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May 9, 2015 17:34
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tsa posted:So 50 / hr then? That depends, would that increase the cost of labor to the point where it would be the main thing driving price? If not, by all means, do it. If so, tread lightly.
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May 9, 2015 17:38
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Hieronymous Alloy posted:It's one of those ideas that's so good everyone who thinks about it rationally ends up supporting it -- and so inherently controversial that almost no one thinks about it rationally. It's a pretty good idea.
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May 9, 2015 17:47
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VideoTapir posted:That depends, would that increase the cost of labor to the point where it would be the main thing driving price? If not, by all means, do it. If so, tread lightly. That actually does interesting things with planning schedules. Usually you can either choose between having the machine idle at some points or having the worker idle. Something that's idle is just costing you for nothing, so you usually want the most expensive thing working at all times. Usually this is the machine, but if it's the worker instead there's an incentive to avoid giving the worker breaks and/or overloading them with tasks to get the company's money's worth.
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May 9, 2015 17:50
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VitalSigns posted:Is there any evidence that the minimum wage has contributed in any significant way to inflation? Lowering the the minimum wage by 30% or so in the last 50 years sure didn't reduce prices any. JeffersonClay posted:Here's the oft-cited Card and Kreuger study on minimum wage in the fast food industry. They found it didn't impact employment but did impact prices. (Price impacts are on pages 15 and 16) There's a lot of economic misconceptions in this post that I'll try to untangle. The minimum wage increases prices by increasing the cost of labor. In the same way that we would expect a rise in lettuce prices to increase the cost of fast food, a rise in labor prices increases the cost of everything because everything requires some sort of human labor to create, transport, distribute, etc... There are other ways to cause inflation. Increasing the money supply and rapid economic growth can both cause inflation. A central bank attempts to use its control of the money supply and interest rates to promote economic growth while limiting inflation. Economic growth that results in moderate inflation is a net positive for people who are in the labor force, but not for people who aren't. It's not that inflation is a horrible evil that must be defeated at all costs, it's an inevitable byproduct of economic growth that can also be caused by other policies. Deflation would imply economic contraction -- a depression -- which would not be good for most people but which might be good for people on a fixed income.
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May 9, 2015 18:50
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JeffersonClay posted:Economic growth that results in moderate inflation is a net positive for people who are in the labor force, but not for people who aren't. It's not that inflation is a horrible evil that must be defeated at all costs, it's an inevitable byproduct of economic growth that can also be caused by other policies. Deflation would imply economic contraction -- a depression -- which would not be good for most people but which might be good for people on a fixed income. The other part of the inflation/deflation issue, and the huge reason why rich people decry inflation (and might even like it when the economy contracts, so long as their investments are safe) is that people who receive their living not through labor but through capital gains/dividends or other investment, or withdraw from stores of previously saved wealth will be receiving less in real terms. If the interest rate on ~my investment portfolio~ of 6% yearly is offset by 7% yearly inflation, then that amounts to a 1% real loss. Which is a good thing because rich people are entitled welfare cases who want to get paid for doing nothing, and shouldn't be paid for doing nothing.
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May 9, 2015 19:14
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JeffersonClay posted:There's a lot of economic misconceptions in this post that I'll try to untangle. One thing is that many people with fixed income have COLAs which is going to cover increase prices to some extent, especially Social Security. Basically yes, you want moderate (under 3%) inflation and the Fed has the ability to restrict the money supply if inflation really starts to go out of control. That said, inflation in the US has been if anything at times, and the it is actually pretty unclear that a much higher minimum wage would actually cause troublesome inflation for the US especially if is raised in steps over years (and maybe monkey around with rates if inflation is too high). The main criticisms against a higher minimum wage (price increases, unemployment) can be mitigate mostly with some tweaking, and it the best tool available considering a much higher EITC/Mincome isn't on the table. It is also the best way to address secular stagnation, which increased labor mobility and productivity isn't going to do. Ardennes fucked around with this message at 19:21 on May 9, 2015 |
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May 9, 2015 19:18
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I agree with that, with one caveat. The studies which show manageable price or employment effects from minimum wage increases are all based on studies on relatively small changes in the minimum wage. We don't really know what would happen after large increases in the minimum wage. So yeah, lets raise the minimum wage to 10 and then 11 and then 12 and see what happens. But people arguing for a 25 dollar minimum wage cannot have any real understanding of what the consequences would be.
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May 9, 2015 19:24
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My understanding is that I would be making a lot more money. So I don't give a gently caress about any of that bullshit you just made up.
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May 9, 2015 19:28
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JeffersonClay posted:I agree with that, with one caveat. The studies which show manageable price or employment effects from minimum wage increases are all based on studies on relatively small changes in the minimum wage. We don't really know what would happen after large increases in the minimum wage. So yeah, lets raise the minimum wage to 10 and then 11 and then 12 and see what happens. But people arguing for a 25 dollar minimum wage cannot have any real understanding of what the consequences would be. I guess it depends what side you want to error on. I would rather make $15 a goal over 5+ years with allow regional waivers then the possibility you would get politically bogged down trying to marginally increase it and then get caught. There is always give and take, but yeah it is very possible to cause unintended consequences if you move too fast and wage floors can't be infinitely high. But if you wanted to argue it down to $13-14, I wouldn't have much of an issue. That said, if you want to keep a market economy running then you need a way increase consumption one way or another (which also helps out not just Americans but every economy that depends on exports to the US). Ultimately, the US is the one country that might be able to pull the world away from stagnating growth. Japan, the Eurozone and most emerging markets at this point are having a difficult time for good reasons (even with generally weak currencies). If consumption surged in the US our trade deficit would likely increase but at the same time it would give the world a much needed robust market for their goods. Ultimately, though I think in the end we are more likely to stagnant. Ardennes fucked around with this message at 19:47 on May 9, 2015 |
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May 9, 2015 19:43
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JeffersonClay posted:There's a lot of economic misconceptions in this post that I'll try to untangle. It's interesting then that every minimum wage increase in the past has had a negligible impact on inflation. Would you say this is due to labor costs actually being a pretty small fraction of the overall cost of running most businesses, or would you say that it's due to the fact that the prices of goods and services are determined by much more than their input costs?
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May 9, 2015 19:54
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JeffersonClay posted:I agree with that, with one caveat. The studies which show manageable price or employment effects from minimum wage increases are all based on studies on relatively small changes in the minimum wage. We don't really know what would happen after large increases in the minimum wage. So yeah, lets raise the minimum wage to 10 and then 11 and then 12 and see what happens. The thing is, even if you pass on 100% of the wage increase in the form of higher prices it's still going to be a negligible change, even if you bring the minimum wage to $15/hour. So even if we had no way of controlling inflation and passed the minimum wage increase anyway, and employers all decided to collude in order to increase prices due to the increase wage, the effect still wouldn't be that bad. That's why talking about inflation in a minimum wage discussion really doesn't make much sense. But in our universe, in reality, McDonalds is already charging us as much as it can for Big Macs. That price is primarily set by competition in the fast food market. Increasing their labor costs, which are a tiny fraction of the input cost to each Big Mac, is not going to significantly alter the supply/demand curve for Big Macs (caveat: increased sales due to min wage workers having more money will push the demand curve a little, but surely you can't argue that selling more Big Macs is a bad thing for McDonalds). quote:But people arguing for a 25 dollar minimum wage cannot have any real understanding of what the consequences would be. Aren't we actually discussing 15, not 25? QuarkJets fucked around with this message at 20:04 on May 9, 2015 |
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May 9, 2015 19:56
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tsa posted:So 50 / hr then? im down
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May 9, 2015 20:32
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JeffersonClay posted:But people arguing for a 25 dollar minimum wage cannot have any real understanding of what the consequences would be. neither do the people arguing against it. economics can be used to prove anything depending on where you focus and what you leave out of your analysis
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May 9, 2015 20:39
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Popular Thug Drink posted:neither do the people arguing against it. economics can be used to prove anything depending on where you focus and what you leave out of your analysis This is pretty much the exact same line of logics used by climate change deniers. If discipline A's argument argument's and conclusions don't fit my own, obviously the entire discipline is flawed and meaningless.
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May 9, 2015 21:01
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Hieronymous Alloy posted:It's one of those ideas that's so good everyone who thinks about it rationally ends up supporting it -- and so inherently controversial that almost no one thinks about it rationally. Just look at all the people ITT who've implied it would be Walmart welfare or some other dumb poo poo.
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May 9, 2015 21:12
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QuarkJets posted:It's interesting then that every minimum wage increase in the past has had a negligible impact on inflation. Would you say this is due to labor costs actually being a pretty small fraction of the overall cost of running most businesses, or would you say that it's due to the fact that the prices of goods and services are determined by much more than their input costs? No its not interesting. It's obvious because minimum wage increases in the past have been tiny in relation to the economy. QuarkJets posted:The thing is, even if you pass on 100% of the wage increase in the form of higher prices it's still going to be a negligible change, even if you bring the minimum wage to $15/hour. So even if we had no way of controlling inflation and passed the minimum wage increase anyway, and employers all decided to collude in order to increase prices due to the increase wage, the effect still wouldn't be that bad. That's why talking about inflation in a minimum wage discussion really doesn't make much sense. You're obfuscating things. If every dollar is passed on as costs increases then we need only count the dollars. If we're talking about a $15 minimum wage increase we're talking about boosting the pay of roughly 40% of the workforce. Whatever percentage of the economy that represents is how much costs are going to increase overall. It's not negligible for $15. Again, I don't think inflation is a prime problem for realistic minimum wage increases, but you're just not getting the analysis right here. Series DD Funding posted:Just look at all the people ITT who've implied it would be Walmart welfare or some other dumb poo poo. It would help keep wal-mart employees alive so that's a bad thing. Rodatose posted:The other part of the inflation/deflation issue, and the huge reason why rich people decry inflation (and might even like it when the economy contracts, so long as their investments are safe) is that people who receive their living not through labor but through capital gains/dividends or other investment, or withdraw from stores of previously saved wealth will be receiving less in real terms. If the interest rate on ~my investment portfolio~ of 6% yearly is offset by 7% yearly inflation, then that amounts to a 1% real loss. You're really mistaken if you think rich people are particularly vulnerable to inflation. They literally own most physical things. asdf32 fucked around with this message at 21:48 on May 9, 2015 |
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May 9, 2015 21:40
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inflation hurts creditors and benefits debtors, thats like day 1 in economics class, you loving intellectual child
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May 9, 2015 22:17
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RBC posted:inflation hurts creditors and benefits debtors, thats like day 1 in economics class, you loving intellectual child Which is why it benefits rich people who leveraged their money into productive businesses.
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May 9, 2015 22:19
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Typo posted:This is pretty much the exact same line of logics used by climate change deniers. all social science: basically climate change denialism
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May 9, 2015 22:28
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philosophy? heh. you might as well be denying the holocaust, plebe
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May 9, 2015 22:29
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Series DD Funding posted:Which is why it benefits rich people who leveraged their money into productive businesses. and hurts rich people who leveraged their money into nonproductive financial instruments and practice usury or landlordism
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May 9, 2015 22:31
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can someone fill me in on the last 25 loving pages of discussion. I was busy being exiled
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May 9, 2015 22:34
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Rodatose posted:and hurts rich people who leveraged their money into nonproductive financial instruments and practice usury or landlordism Owning long term fixed income securities is a bummer if inflation ticks up but stocks and real estate track inflation.
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May 9, 2015 22:37
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LeoMarr posted:can someone fill me in on the last 25 loving pages of discussion. I was busy being exiled We had some discussion and decided that rather than waste time in a mostly fruitless struggle for a minimum wage increase, it'd be a better idea to take control of the means of production back from the bourgeoisie scum. Also that we want LF to come back, but that's not new.
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May 9, 2015 22:38
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asdf32 posted:Owning long term fixed income securities is a bummer if inflation ticks up but stocks and real estate track inflation. http://www.investopedia.com/articles/investing/052913/inflations-impact-stock-returns.asp quote:Since the 1930s, the research suggests that almost every country suffered the worst real returns during high inflation periods. When examining S&P 500 returns by decade and adjusted for inflation, the results show that the highest real returns occur when inflation is 2 to 3%. For landlords, ability to raise rents to match inflation only works if the renting class sees higher wages and is able to pay the owner's higher rents. In cases where economic growth isn't received by everyone, then rents have to stay flat or you have to go through the expense of eviction and turnover for those who can't pay the rent. And the other sections of the owning class (those investors in productive businesses) individually fight against the lower classes receiving the benefits of growth through higher wages, because their primary focus is trying to minimize production costs to outcompete other individual owners and not get swallowed up. Also for real estate to retain its value and keep up with inflation, some sort of maintenance has to be put into it to (which is productive) to justify the higher costs. And inflation means higher prices in maintenance costs. Rodatose fucked around with this message at 23:15 on May 9, 2015 |
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May 9, 2015 23:09
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QuarkJets posted:It's interesting then that every minimum wage increase in the past has had a negligible impact on inflation. Would you say this is due to labor costs actually being a pretty small fraction of the overall cost of running most businesses, or would you say that it's due to the fact that the prices of goods and services are determined by much more than their input costs? Past minimum wage increases have been small, I think the effects have been swamped by other factors which influence inflation. I think the same thing is true for employment. Wages are sticky enough that a mandatory one dollar raise doesn't affect employment decisions much, but that won't necessarily hold true at larger amounts. QuarkJets posted:The thing is, even if you pass on 100% of the wage increase in the form of higher prices it's still going to be a negligible change, even if you bring the minimum wage to $15/hour. So even if we had no way of controlling inflation and passed the minimum wage increase anyway, and employers all decided to collude in order to increase prices due to the increase wage, the effect still wouldn't be that bad. That's why talking about inflation in a minimum wage discussion really doesn't make much sense. The impact of wage increases will vary by industry. Industries where cheap labor is a significant input will be affected more, and other industries will be affected if the products of the first industry are inputs in their production process. Yes businesses are charging the highest rates they can charge, which in a competitive environment has little to do with overall demand and much to do with the prices charged by their competitors, which is in turn based on the cost of production. If every restaurant must increase its wages, and all restaurants raise prices in turn, no business loses market share (although we'd expect the industry as a whole to sell less, depending on the elasticity of demand for the product). The labor share of a Big Mac is about 25%, so doubling wages would lead to a 25% increase in cost, and there's no reason to expect the large majority of that would not be passed on to consumers. This is why Big Macs cost more in places like Australia and Sweden where labor costs are higher. JeffersonClay fucked around with this message at 00:44 on May 10, 2015 |
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May 9, 2015 23:41
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Rodatose posted:http://www.investopedia.com/articles/investing/052913/inflations-impact-stock-returns.asp That's showing a correlation between growth and inflation. Low growth is obviously bad for asset holders. But inflation is literally the increase in the price of stuff. The people that own stuff are well insulated from that all else being equal (most certainly including property owners). If minimum wage is the panacea it's supposed to be it will be growing the economy even while creating inflation. Mo_Steel posted:We had some discussion and decided that rather than waste time in a mostly fruitless struggle for a minimum wage increase, it'd be a better idea to take control of the means of production back from the bourgeoisie scum. I thought the argument was that we had to strictly interpret mainstream economic consensus which means capitalism (with non unemployment causing minimum wage) for all. asdf32 fucked around with this message at 00:10 on May 10, 2015 |
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May 10, 2015 00:05
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asdf32 posted:But inflation is literally the increase in the price of stuff. e: If this what you say, then I say not all stuff happen sameway. Some price good in bad, some bad in good. Some stuff not actually stuff, but price tied to the bank with value-tracking commodity matched against the real stuff in the goods basket of the cpi. Like golds. Like silvers. Like the moneys. Rodatose fucked around with this message at 00:24 on May 10, 2015 |
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May 10, 2015 00:13
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JeffersonClay posted:Yes businesses are charging the highest rates they can charge, which in a competitive environment has little to do with overall demand and much to do with the prices charged by their competitors, which is in turn based on the cost of production. If every restaurant must increase its wages, and all restaurants raise prices in turn, no business loses market share (although we'd expect the industry as a whole to sell less, depending on the elasticity of demand for the product). The labor share of a Big Mac is about 25%, so doubling wages would lead to a 25% increase in cost, and there's no reason to expect the large majority of that would not be passed on to consumers. This is why Big Macs cost more in places like Australia and Sweden where labor costs are higher. Why is there no reason to expect most of the costs won't be passed on to consumers? Are McDonald's profits zero?
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May 10, 2015 01:57
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VitalSigns posted:Why is there no reason to expect most of the costs won't be passed on to consumers? Are McDonald's profits zero? At least for McDonald's their competitors draw from the same labor pool so they'll probably all raise the same amount unless they start competing with fancier places that already paid more.
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May 10, 2015 02:04
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VitalSigns posted:Why is there no reason to expect most of the costs won't be passed on to consumers? Are McDonald's profits zero? They would be negative with a large minimum wage increase unless revenue increases.
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May 10, 2015 02:08
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JeffersonClay posted:There are other ways to cause inflation. Increasing the money supply and rapid economic growth can both cause inflation. A central bank attempts to use its control of the money supply and interest rates to promote economic growth while limiting inflation. Economic growth that results in moderate inflation is a net positive for people who are in the labor force, but not for people who aren't. It's not that inflation is a horrible evil that must be defeated at all costs, it's an inevitable byproduct of economic growth that can also be caused by other policies. Deflation would imply economic contraction -- a depression -- which would not be good for most people but which might be good for people on a fixed income. Yes, I know these things, and that's the problem with your argument: it does assume that inflation is always bad because you're taking the position "it doesn't matter if workers can feed their families, what about people on fixed income, they will be hurt if prices go up". But for some reason you don't care about the much greater inflation we purposely cause with our central bank policies, even though that hurts the pensioners and whoever else you're hiding behind right now. So you don't really care about price increases at all, except as a convenient weapon to attack the minimum wage. So let's say the minimum wage causes prices to increase. Well, the central bank has inflation targets it's trying to hit and uses tools like interest rates and QE to hit those. So, if prices go up because of the minimum wage, the central bank would just need to do less deflation-fighting on its own. Follow-up question: how do we know what "the right" level of prices are? We could help fixed-income people right now by lowering the minimum wage, according to you, but you don't want to do that. What if the low prices they're paying right now is a result of rent-seeking because of economic exploitation of minimum wage workers who aren't being paid enough for their work to even stay healthy. VitalSigns fucked around with this message at 02:24 on May 10, 2015 |
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May 10, 2015 02:16
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